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Coca-Cola Enterprises Inc (NYSE:CCE)
Beneish M-Score
-2.73 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Coca-Cola Enterprises Inc has a M-score of -2.73 suggests that the company is not a manipulator.

CCE' s 10-Year Beneish M-Score Range
Min: -4.57   Max: -2.21
Current: -2.73

-4.57
-2.21

During the past 13 years, the highest Beneish M-Score of Coca-Cola Enterprises Inc was -2.21. The lowest was -4.57. And the median was -2.54.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Coca-Cola Enterprises Inc for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 0.9931+0.528 * 0.9688+0.404 * 0.9643+0.892 * 1.0063+0.115 * 0.9027
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9968+4.679 * -0.0365-0.327 * 1.1163
=-2.73

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $1,514 Mil.
Revenue was 1925 + 2136 + 2333 + 1870 = $8,264 Mil.
Gross Profit was 669 + 808 + 846 + 650 = $2,973 Mil.
Total Current Assets was $2,460 Mil.
Total Assets was $8,543 Mil.
Property, Plant and Equipment(Net PPE) was $2,101 Mil.
Depreciation, Depletion and Amortization(DDA) was $309 Mil.
Selling, General & Admin. Expense(SGA) was $1,954 Mil.
Total Current Liabilities was $2,608 Mil.
Long-Term Debt was $3,320 Mil.
Net Income was 112 + 238 + 198 + 115 = $663 Mil.
Non Operating Income was -7 + 0 + 1 + -1 = $-7 Mil.
Cash Flow from Operations was 391 + 378 + 146 + 67 = $982 Mil.
Accounts Receivable was $1,515 Mil.
Revenue was 2032 + 2174 + 2156 + 1850 = $8,212 Mil.
Gross Profit was 688 + 787 + 753 + 634 = $2,862 Mil.
Total Current Assets was $2,568 Mil.
Total Assets was $9,525 Mil.
Property, Plant and Equipment(Net PPE) was $2,353 Mil.
Depreciation, Depletion and Amortization(DDA) was $308 Mil.
Selling, General & Admin. Expense(SGA) was $1,948 Mil.
Total Current Liabilities was $2,195 Mil.
Long-Term Debt was $3,726 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(1514 / 8264) / (1515 / 8212)
=0.18320426 / 0.18448612
=0.9931

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(808 / 8212) / (669 / 8264)
=0.34851437 / 0.35975315
=0.9688

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (2460 + 2101) / 8543) / (1 - (2568 + 2353) / 9525)
=0.46611261 / 0.48335958
=0.9643

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=8264 / 8212
=1.0063

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(308 / (308 + 2353)) / (309 / (309 + 2101))
=0.11574596 / 0.12821577
=0.9027

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(1954 / 8264) / (1948 / 8212)
=0.23644724 / 0.23721383
=0.9968

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((3320 + 2608) / 8543) / ((3726 + 2195) / 9525)
=0.69390144 / 0.6216273
=1.1163

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(663 - -7 - 982) / 8543
=-0.0365

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Coca-Cola Enterprises Inc has a M-score of -2.73 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Coca-Cola Enterprises Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.92831.09721.00390.99952.23270.83770.84581.06091.03860.9931
GMI 1.01151.02151.03561.033410.99871.00991.01681.03210.9688
AQI 0.99350.90651.00270.55341.53261.030.95251.0131.03860.9643
SGI 1.03041.05661.05721.04160.29881.03021.23380.97321.01861.0063
DEPI 0.97471.0460.96310.94661.11221.2180.84460.9981.08930.9027
SGAI 0.99390.98720.96370.99060.79641.01380.96921.01470.96980.9968
LVGI 0.97161.09610.94341.48960.38521.55371.12611.06861.09211.1163
TATA -0.04330.0077-0.0131-0.3847-0.0321-0.0233-0.0121-0.0287-0.0168-0.0365
M-score -2.71-2.35-2.45-4.57-1.66-2.86-2.54-2.59-2.49-2.73

Coca-Cola Enterprises Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.10091.06091.01840.99241.11581.03861.0421.22961.03070.9931
GMI 1.01291.01681.01771.02541.03161.03211.02341.00010.98010.9688
AQI 0.99761.0131.00621.01561.01211.03860.99340.96220.99950.9643
SGI 0.98220.97320.96820.98561.00711.01861.02341.05221.0341.0063
DEPI 0.97850.9980.99361.03611.07941.08931.10661.10250.9720.9027
SGAI 0.98671.01471.04581.02971.01440.96980.91930.93890.94870.9968
LVGI 1.08441.06861.14011.12591.13351.09211.0831.09211.06951.1163
TATA -0.0213-0.0285-0.0517-0.0278-0.0232-0.0168-0.0165-0.0157-0.0149-0.0365
M-score -2.52-2.59-2.78-2.65-2.49-2.49-2.49-2.32-2.52-2.73
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